Royal Bank of Canada Investor Presentation
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Royal Bank of Canada
Investor Presentation
Q4/2014
Financial information is presented on a consolidated basis in Canadian dollars and is based on International Financial Reporting Standards
(IFRS), unless otherwise noted. Our 2014 Annual Report and Q4/2014 Supplementary Financial Information are available on our website at
rbc.com/investorrelations.
Investor RelationsCaution regarding forward-looking statements From time to time, we make written or oral forward-looking statements within the meaning of certain securities laws, including the “safe harbour” provisions of the United States Private Securities Litigation Reform Act of 1995 and any applicable Canadian securities legislation. We may make forward-looking statements in this RBC Investor Presentation, in filings with Canadian regulators or the United States (U.S.) Securities and Exchange Commission (SEC), in reports to shareholders and in other communications. Forward-looking statements in this presentation include, but are not limited to, statements relating to our financial performance objectives, vision and strategic goals. The forward-looking information contained in this RBC Investor Presentation is presented for the purpose of assisting the holders of our securities and financial analysts in understanding our financial position and results of operations as at and for the periods ended on the dates presented, and our financial performance objectives, vision and strategic goals, and may not be appropriate for other purposes. Forward-looking statements are typically identified by words such as “believe”, “expect”, “foresee”, “forecast”, “anticipate”, “intend”, “estimate”, “goal”, “plan” and “project” and similar expressions of future or conditional verbs such as “will”, “may”, “should”, “could” or “would”. By their very nature, forward-looking statements require us to make assumptions and are subject to inherent risks and uncertainties, which give rise to the possibility that our predictions, forecasts, projections, expectations or conclusions will not prove to be accurate, that our assumptions may not be correct and that our financial performance objectives, vision and strategic goals will not be achieved. We caution readers not to place undue reliance on these statements as a number of risk factors could cause our actual results to differ materially from the expectations expressed in such forward-looking statements. These factors – many of which are beyond our control and the effects of which can be difficult to predict – include: credit, market, liquidity and funding, insurance, regulatory compliance, operational, strategic, reputation, competitive and systematic risks and other risks discussed in the Risk management and Overview of other risks sections of our 2014 Annual Report; anti-money laundering; growth in wholesale credit; the high levels of Canadian household debt; cybersecurity; the business and economic conditions in Canada, the U.S. and certain other countries in which we operate; the effects of changes in government fiscal, monetary and other policies; tax risk and transparency; our ability to attract and retain employees; the accuracy and completeness of information concerning our clients and counterparties; the development and integration of our distribution networks; model, information technology, information management, social media, environmental and third party and outsourcing risk. We caution that the foregoing list of risk factors is not exhaustive and other factors could also adversely affect our results. When relying on our forward- looking statements to make decisions with respect to us, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Material economic assumptions underlying the forward looking-statements contained in this RBC Investor Presentation are set out in the Overview and outlook section and for each business segment under the heading Outlook and priorities in our 2014 Annual Report. Except as required by law, we do not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by us or on our behalf. Additional information about these and other factors can be found in the Risk management and the Overview of other risks sections in our 2014 Annual Report. Information contained in or otherwise accessible through the websites mentioned does not form part of this RBC Investor Presentation. All references in this Q4 presentation to websites are inactive textual references and are for your information only. Investor Relations 1
Royal Bank of Canada SECTION I
RBC is one of the largest banks globally
Canada’s largest bank by market capitalization, with broad leadership in financial services
Offices in Canada, United States and 38 other countries
~78,000 full- and part-time employees who serve more than 16 million clients worldwide
North American ranking(1) Global ranking(1,2)
281
228
(Market capitalization, US$ billion) (Market capitalization, US$ billion)
281
238 228
180
165
191 190
180
#5 165
157 156
#12
10 3
96 92 86 113 111
79 74 10 3 96 92
70 90 86 82 74 74 74
46 46 46 45
37 32
PNC Financial
JP Morgan
CIBC
RBC
TD
BMO
Goldman Sachs
Wells Fargo
Citigroup
US Bancorp
Bank of NY Mellon
Itau Unibanco
American Express
Scotiabank
Morgan Stanley
Capital One Financial
Westpac
State Street
Bank of America
Wells Fargo
Bank of America
Citigroup
Santander
Bank of China
Aust and Nz Banking
Mitsubishi
ICBC
HSBC
Scotiabank
TD
CCB
CBA
JP Morgan
ABC
RBC
American Express
Lloyds
Extending our lead in Canada and selectively growing globally
Investor Relations 3
(1) Market data from Bloomberg as of December 2, 2014.
(2) ICBC: Industrial and Commercial Bank of China; CCB: China Construction Bank Corporation; ABC: Agriculture Bank of China; CBA: Commonwealth Bank of Australia; Santander: Banco
Santander, S.A.A diversified business model – RBC’s key strength
Diversified business mix, with the right balance of retail and wholesale
Almost two-thirds of revenue from Canada
Strategic approach in key businesses in the U.S. and select international markets
Earnings by business segment(1) Revenue by geography(1)
For the year ended October 31, 2014 For the year ended October 31, 2014
International
Capital Markets 19%
23% Personal &
Investor & Commercial
Treasury Banking
Services Canada
51% U.S.
5% 63%
18%
Insurance
9%
Wealth
Management
12%
Investor Relations 4
(1) Amounts exclude Corporate Support. These are non-GAAP measures. For additional information, see the business segment results and results by geographic segment sections of our 2014
Annual Report and slide 23.Strong financial profile
Revenue Net Income
($ billions) ($ billions)
34.1 9.0
8.3
30.7
29.1 7.5
27.6
6.4
2011 2012 2013 2014 2011 2012 2013 2014
Return on Equity (ROE)(1) 2014 Basel III Capital ratios – “All-in” basis(2)
Common Equity Tier 1 9.9%
Tier 1 Capital 11.4%
19.7% Total Capital 13.4%
19.6%
18.7% 19.0%
Credit ratings(3)
Moody’s S&P Fitch DBRS
Aa3 AA- AA AA
2011 2012 2013 2014 Negative Negative Stable Stable
Investor Relations 5
(1) ROE may not have a standardized meaning under GAAP principles and may not be comparable to similar measures disclosed by other financial institutions. For additional information, see
slide 23. (2) Capital calculated to include all regulatory adjustments that will be required by 2019 but retaining the phase-out rules for non-qualifying capital. Refer to the Capital Management
section of our 2014 Annual Report for details on Basel III requirements. (3) Based on long-term senior debt ratings.History of delivering value to our shareholders
Total shareholder return (TSR)(1) Annual dividend history*
RBC Peer Avg. ($ per share)
3 Year 23% 19%
RBC increased its dividend 2 times in 2014, a total
5 Year 12% 8% increase of 12%
10 Year 14% 5%
10%
$2.84
G R
CA $2.53
Dividend
$2.28
Current quarterly dividend: $0.75 $2.08
$2.00 $2.00 $2.00
FY2014 payout ratio of 47%, in line $1.82
with our target of 40-50%
$1.44
$1.18
Share buybacks
Announced normal course issuer bid
on October 27, 2014 to repurchase
up to 12 million common shares
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
* Dividends declared per common share.
Our goal is to maximize shareholder returns by achieving TSR above our peer average
Investor Relations 6
(1) Annualized TSR is calculated based on common share price appreciation plus reinvested dividend income. Source: Bloomberg, as at October 31, 2014. RBC is compared to our
global peer group. The peer group average excludes RBC; for the list of peers, please refer to our 2014 Annual Report.Key strategic priorities aligned to our long-term goals
Strategic goals
In Canada, to be the undisputed leader in financial services
Globally, to be a leading provider of capital markets, investor and wealth management solutions
In targeted markets, to be a leading provider of select financial services complementary to our core
strengths
Strategic priorities
Personal & Investor & Treasury
Wealth Management Insurance Capital Markets
Commercial Banking Services (I&TS)
Offering a differentiated Building a high- Improving distribution Providing excellence in Maintaining our
experience: value for performing global asset efficiency and custody, asset servicing leadership position in
money, advice, access management business deepening client and payments, with an Canada
and service Focusing on high net relationships integrated funding and Expanding and
Making it easier to do worth and ultra-high net Making it easier for liquidity management strengthening client
business with us and be worth clients to build clients to do business business relationships in the U.S.
the lower cost producer global leadership with us Focusing on organic Building on core
Converging into an Leveraging RBC and Pursuing select growth through strengths and
integrated multi-channel RBC Wealth international developing new client capabilities in Europe
network Management strengths opportunities to grow relationships, and Asia
and capabilities our reinsurance deepening existing
Enhancing client relationships and Optimizing capital use
experience and business to earn high risk-
promoting the RBC
improving efficiency in brand adjusted returns on
the Caribbean and U.S. assets and equity
Leveraging I&TS as a
driver of enterprise
growth strategies with a
focus on cross-selling
and deposit gathering
Investor Relations 7Business Segments SECTION II
Personal & Commercial Banking
Overview
RBC continues to be the undisputed leader in financial services in Canada
Personal & Commercial Banking account for over 50% of total RBC earnings
#1 or #2 market share in all product categories
Most branches and largest sales force in Canada while maintaining an industry leading efficiency ratio vs. our peer
average(1)
Second largest bank by assets in English Caribbean, with branches in 18 countries and territories(2)
In the U.S., our cross-border banking business serves the needs of Canadian clients, through online channels, as well as U.S.
Wealth Management clients
Offering a broad range suite of products and financial services to individual and business clients
Revenue and Net Income Business metrics(3)
($ billions)
13.7 Canada Caribbean & U.S.
13.0 0.9
12.4
12.0 0.8
0.8
0.8 2.4 Clients (million) 12.2 1.4
2.3
2.1
2.3
Branches 1,272 93
3.1
3.0
2.9
2.7 ATMs 4,620 309
6.9 7.3
6.6
6.2
Employees (FTE) 31,442 4,732
4.4 4.5
4.1
3.7 Loans & acceptances 350 8
($ billion)
2011 2012 2013 2014 Deposits ($ billion) 270 16
PFS BFS CPS Caribbean & U.S. Banking Net Income
Investor Relations 9
(1) Peers include TD, CIBC, BMO and BNS as of Q3/2014. (2) Based on average balances. (3) For the quarter ended October 31, 2014. Loans & Acceptances and Deposits are average
balances over the quarter. Note: PFS: Personal Financial Services; BFS: Business Financial Services; CPS: Cards and Payment Solutions, and; FTE: Full-time equivalent.Personal & Commercial Banking – Canada
Offering a differentiated experience
Be the undisputed leader in Canada and continue to grow volume at a premium to peers
Demonstrate the value for money that sets RBC apart through quality of advice and service, and industry-leading convenience
and access
Making it easier to do business with us
Maintain focus on digitizing the bank and simplifying our end-to-end processes
Make it simpler and easier for clients to do business with us through self, assisted, and full-serve options
Invest in skills, accreditation and engagement of our employees to enable us to compete more effectively
Converging into an integrated multi-channel network
Leveraging our unparalleled distribution breadth (e.g. most branches and ATMs in Canada), internal capabilities and
strategic external partnerships to maintain our market leadership and extend our sales power
Adapting our distribution network to ongoing changes in client preferences, including designing new products specifically for
online and mobile channels
Recent awards
Best Global Retail Bank of the Year 2014, following two consecutive years as being named Best Retail Bank in North
America (Retail Banker International)
Bank of the Year in Canada 2014 (The Banker)
Best Trade Finance Bank in Canada 2014 for the second consecutive year (Global Finance)
Best Private Banking Services in Canada, the Caribbean, Cayman Islands and Jersey 2014 (Euromoney)
Best Private Bank in Canada and the Caribbean 2014 (Professional Wealth Management)
Innovation in Customer Service 2013 (Retail Banker International)
Best Commercial Bank in Canada 2013 (World’s Finance)
#1 RBC Visa Infinite Avion in overall satisfaction 2013 (MLM and Maritz)
Investor Relations 10Personal & Commercial Banking – Canada
Volume Cross-selling metric
($ billions) (Households with transaction accounts, investments
and borrowing products)(1)
CAGR 8%
608
578 22%
538 264 Superior cross-
496 248
230 sell ability
209
14%
330 344
287 308
(7)
2011 2012 2013 2014 RBC Peer Average
Loans and acceptances Deposits
Market share(2) Industry leading Efficiency Ratio (%)(7)
Market
Product Rank Peer
share Average (7)
49.7% 49.7% 49.6%
49.2%
Consumer lending(3) 1 23.7%
Personal core deposits + GICs 2 20.2%
Long-Term Mutual Funds(4) 1 14.2% 45.4%
44.5% 44.7%
Business loans ($0-$25MM)(5) 1 25.3% 44.2%
Business deposits(6) 1 26.0%
2011 2012 2013 2014
Investor Relations 11
(1) Canadian Financial Monitor by Ipsos Reid – 12,000 Canadian households annually – data based on Financial Group for the 12-month period ending Oct. 2013. (2) Market share is calculated using most current data available from OSFI (M4), Investment Funds Institute of Canada (IFIC) and Canadian Bankers
Association (CBA). OSFI, IFIC and Consumer Lending CBA data is at July 2013 and 2014, Business Loans CBA data is at June 2013 and 2014. Market share is of total Chartered Banks except for Business Loans which is of total 7 Banks (RBC, BMO, BNS, CIBC, TD, NBC, CWB). (3) Consumer Lending market
share is of 6 banks (RBC, TD, CIBC, BMO, BNS and National). Consumer Lending comprises residential mortgages (excluding acquired portfolios), personal loans and credit cards. (4) Mutual fund market share is per IFIC and is compared to total industry.(5) Business Deposits market share is of total Chartered
Banks and excludes Fixed Term, Government and Deposit Taking Institution balances. 5) Business Loans market share is of the 9 Chartered Banks that submit tiered data to CBA on a quarterly basis. (6) Business Deposits market share is of total Chartered Banks and excludes Fixed Term, Government and Deposit
Taking Institution balances. (7) Peer average is based on annual results for BMO, BNS, CIBC & TD. 2014 reflects average reported Q3/2014 results for peers.Wealth Management
Leveraging Canadian strengths to build global leadership Recent awards / rankings
Top 5 Global Wealth Manager by client assets (Scorpio)
Building a high performing global asset management business
Outstanding Wealth Manager – Customer Relationship Service and
Top quartile in terms of industry profitability(1) Engagement (Private Banker International)
Best Overall Fund Group (Lipper, Canada)
Top 50 global asset manager(2)
Fixed Income Manager of the Year PH&N (Morningstar)
Focusing on HNW and UHNW client segments to extend our industry- Top 50 Global Asset Manager (Pensions & Investments / Towers Watson)
leading share of HNW client assets in Canada and expand share Best Bank-owned Brokerage Firm in Canada (International Executive
Brokerage Report Card)
globally
Best Private Banking Services Overall – Canada, Caribbean, Cayman
Driving strong advisor productivity as a leader in fee-based assets Islands, Jersey (Euromoney)
per advisor(3) Best Private Bank in Canada and the Caribbean (PWM/The Banker
Global Private Banking Awards)
Client assets at $1.17 trillion in Q4/2014, a 14% YoY increase Trust Company of the Year (Society of Trust and Estate Practitioners
(STEP))
Grew AUA by 11% and AUM by 14% CAGR since Q4/2011 Editor’s Award for Institutional Trust Co, Women in Wealth
Management (Wealth Briefing Asia Awards)
Diversity/Gender Program of the Year (City Wealth Magic Circle)
Revenue and Net Income Cash Earnings Assets Under Administration and
($ millions) ($ millions) Assets Under Management
($ billions)
6,313 8% 1%
CAGR: AU A C
AGR: 1
4%
5,487 1,697 AG R: 1
4,708 4,835 1,161 AU M C
1,373 718
1,036 1,117 953 639
2,225 879 578
2,430 527
1,948 1,977 819
452
387
340
2,186 306
1,724 1,741 1,889
811 1,083
753 886
2011 2012 2013 2014 2011 2012 2013 2014 2011 2012 2013 2014
Canadian WM U.S. & International WM GAM Net Income AUA AUM
Investor Relations 12
HNW: High net worth; UHNW: Ultra-high net worth; AUA: Assets under administration; and, AUM: Assets under management.
(1) BCG Asset Management Benchmarking Survey 2013. (2) Pensions & Investments and Towers Watson 2014 Global Asset Manager Ranking Report. (3) Investor Economics Report published
in December 2013.Wealth Management – Global Asset Management
Building a high-performing global asset management business
Driving top-tier profitability in our largest Wealth Management business
Over $350 billion in client assets, generating ~60% of RBC Wealth Management earnings on a full year basis
Investor asset mix of 45% Individual / 55% Institutional client assets
Second fastest growing asset manager, between 2007-2012, by AUM; ranked 48th largest asset manager worldwide(1)
Extending our lead in Canada
Largest fund company in Canada with 14.5% market share; leader in last twelve months net flows (18% share)(2)
Top quartile fund performance, with 81% of AUM in 1st or 2nd quartile(3)
Third largest institutional pension asset manager in Canada(4)
Expanding our global solutions and capabilities
Continuing to see momentum in our international institutional business, including BlueBay, driven by market share gains in
higher fee-based solutions such as equities and credit strategies
Strengthening our distribution capabilities while further enhancing our global product suite to meet the needs of our clients
Hired teams in London and Canada to build out our global equities team in 2014
Annual AUM Growth: AUM by Client Segment(6)
RBC GAM vs. Worldwide AM Industry(5)
3 50
29%
27% 28%
3 00
20%
2 50
13% InternationalInstitutional
International Institutional
12% 11% 13%
U.S. Institutional
U.S. Institutional
9% 8%
2 00
21%
Canadian
Canadian Institutional
Institutional
1%
1 50
Canadian
CanadianRetail
Retail
(1)% 1 00
46%
2009 2010 2011 2012 2013 100%
5 0
RBC GAM ex-acquisitions AM Industry 0
2007
2007 2014
2014
Investor Relations 13
(1) From 2007 to 2012 RBC moved up from 98th to 48th largest Asset Manager worldwide. Based on Towers Watson P&I Largest 500 Worldwide Asset Managers, Year End 2012. The Towers Watson / P&I survey includes AUM for RBC which is not managed
by GAM. A calculation of GAM’s AUM growth over the above period would not result in a material difference to the percentage growth shown above. (2) Investment Funds Institute of Canada (IFIC) as at September 30, 2014 and RBC reporting. (3) As at
September 30, 2014. Based on a blended 1/3/5 year basis, gross of fees, against RBC Global Asset Management peer group. (4) Benefits Canada as at December 31, 2013. (5) Boston Consulting Group, 2013. (6) Data as of October 31, 2014.Wealth Management
Canada – Extending our industry leadership
Extending our #1 position
Grew HNW market share by ~400 bps to 19% in the last four years(1) with Fee-based assets per advisor(2)
momentum and anticipate reaching 20% market share by 2015 ($ millions)
Maintaining profitable growth in a challenging market Over 1.8x the
peer average
Generating 33% of RBC Wealth Management earnings with strong pre-
tax margin, highest among North American peers(3) $61
Driving strong advisor productivity
$34
Canadian leader in fee-based assets per advisor(1)
Consistently driving revenue per advisor of over $1 million per year, 48%
above Canadian industry average(1)
Competitive hires delivering strong new asset growth RBC Cdn Peer Average
Leveraging Enterprise linkages to continue to extend market share gains
U.S. & International Loans(4) & Deposits
United States Strong growth in our credit and deposit taking businesses, with
Steadily increasing advisor productivity loans growing at a CAGR of 17% and deposits at a CAGR of 7%
Growing complementary distribution through successfully since 2012
recruiting revenue producers and establishing new clearing Average Balances
relationships ($ billions)
36.2
Improving operational efficiencies and leveraging RBC’s global 31.9
29.2
capabilities to broaden our product offering
Outside North America 15.7
Refocusing on UHNW and HNW client acquisitions from select 9.9
12.1
markets where we have scale
Leveraging RBC’s global capabilities (Global Asset Management 2012 2013 2014
and Capital Markets) Loans Deposits
Optimizing our operating model to drive long-term performance
Investor Relations 14
(1) Investor Economics report on RBC’s full wealth and investment offering in Canada (December 2013). (2) Investor Economics report (June 2014). (3) As per BCG Global Wealth
Manager Benchmarking 2014, based on 2013 results. (4) Total of average loans & acceptances.Insurance
We provide a wide range of life, health, home, auto, travel and wealth accumulation solutions to individual and group clients
across Canada and offer reinsurance solutions for clients globally
Improving distribution efficiency
Delivering multi-line “insurance advice for your life” through integrated product cross-sell strategies
Focusing on developing efficient and effective proprietary channels that deliver strong results and strengthening our position
in profitable third-party distribution channels
Deepening client relationships
Providing a comprehensive suite of RBC Insurance products and services to continue to meet our clients’ unique needs
Simplifying the way we do business
Enhancing and streamlining all processes to ensure that clients find it easy to do business with us
Pursuing select international opportunities to grow our reinsurance business
Pursuing niche opportunities, diversifying risks and growing European business to generate stable and diversified earnings
Revenue and Net Income Premiums and Deposits(1)
($ millions) ($ millions)
8,000
17.0% 0
7,800
7,600 15.3% 0
4,897 4,964 7,400
7,200 12.5% 0
7,000 0
4,475 6,800 0
6,600 0
1,905 2,053 6,400
6,200
6,000
5,164 0
0
1,799 3,928 5,800
5,600 10.0% 0
0
5,400
5,200 4,701 4,849 4,924 0
1,966 5,000
4,800 0
4,600 2,745 0
4,400
4,200 2,487 2,580 0
4,000
3,800
2,346 0
0
2,992 2,911 3,600
3,400 0
2,676 3,200 0
3,000
2,800 0
2,600 0
2,400 (0)
1,962 2,200 (0)
781 2,000
1,800 2,355 2,362 2,344 2,419 (0)
(0)
713 1,600
1,400 (0)
600 713 1,200
1,000 (0)
800
600 (0)
400 (0)
595 200 (0)
0 (0)
2011 2012 2013 2014 2011 2012 2013 2014
Canada International & Other Net Income Adjusted Net Income (2) Canadian Insurance International Insurance Acquisition Expense Ratio
Investor Relations 15
(1) Acquisition Expense Ratio calculated as Total Acquisition Expense/Net Premiums.
(2) Adjusted net income excludes a charge of $160MM ($118MM after-tax) as a result of new tax legislation in Canada in Q4/2013. This is a non-GAAP measure. For additional
information, see slide 23.Investor & Treasury Services
Key businesses Business objectives
Specialist provider of asset servicing, custody and In Canada, be the top provider of domestic custody,
payments services, with an integrated funding and asset servicing and transaction banking services
liquidity business
Compete in offshore domicile markets, as a leading
Top 10 global custodian by AUA provider of fund services from centers of excellence
Best Custodian Overall, #1 Custodian in Europe in Luxembourg and Ireland
and #1 Custodian in North America(1), Real
Estate Fund Administrator of the Year(2) Maintain a selective presence in global markets, in
Canadian leader in cash management, support of Investor & Treasury Services’ global
correspondent banking and trade finance for offshore strategy
financial institutions (processing >50% of all
payments into Canada)
Funding and liquidity management for RBC
Revenue and Net Income Assets under administration(3) Efficiency Ratio
($ millions) ($ billions) (%)
11%
1,804
1,884 CAGR: 3,703
3,209
77%
1,142 75%
72%
905 441 2,887 68%
370 2,744
230 315
102 339
2011 2012 2013 2014 2011 2012 2013 2014 2011 2012 2013 2014
Revenue Net Inco me
A djusted Net Inco me (4)
Investor Relations 16
(1) Global Investor/ISF magazine’s Global Custody Survey 2014. (2) Custody Risk European Awards 2014. (3) Spot balances, as at October 31, 2014 (4) Adjusted net income excludes a loss of
$224 million ($213 million after-tax) related to our acquisition of the remaining 50% stake of RBC Dexia in Q3/2012 and $44 million ($31 million after-tax) related to the integration of Investor
Services in Q2/2013. These are non-GAAP measures. For additional information, see slide 23.Capital Markets
A premier North American investment bank with select global reach
Full suite of integrated Corporate & Investment Banking and Global Markets services
Strategically positioned in the largest financial centers, covering 90% of global investment banking fee pool(1)
Top talent with expertise and track record of excellence
Canada United States U.K. & Europe Asia Pacific
Full suite of products and Full service investment M&A advisory and Primarily distribution with
services across all sectors bank with equity and fixed origination in key sectors select M&A advisory and
income sales & trading with fixed income, equity origination
and FX sales & trading
Revenue and Net Income(2) Revenue by geography
($ millions) (2014)
7,366 Asia Pacific
6,580 3%
6,188 3,437
5,324 U.K. &
3,014 Europe
2,533
2,371 13% Canada
29%
3,930 U.S.
U.S.
3,635 3,492
3,143
2,055 U.S.
1,576 1,700
1,292 55%
2011 2012 2013 2014
Global Markets Corporate & Investment Banking Net Income
Investor Relations 17
(1) Thomson Reuters Global Banking Review – First nine months 2014
(2) Other revenue not depicted on the graph, but included in Total revenue and Net Income.Capital Markets
Maintaining our leadership position in Canada
Focus on long-term client relationships and leverage our strong cross-border capabilities
Improve collaboration with Wealth Management to drive operational efficiencies
Expanding and strengthening client relationships in the U.S.
Build on our momentum and leverage broader relationships and client investments to expand origination, advisory,
and distribution
Increase focus on deepening relationships with existing clients to drive cross-sell
Selectively building on core strengths and capabilities in UK/Europe and Asia
Grow prudently by developing strong client relationships and selectively adding talent to expand our capabilities
Continue to expand distribution capabilities in Hong Kong and selectively grow investment banking in Sydney
Optimizing capital use to earn high risk-adjusted returns on assets and equity
Maintain revenue mix with greater balance between investment banking and trading revenue
Maintain disciplined diligence on the risks and costs of our business
Recent awards / Rankings
10th largest by global investment bank fees (Thomson Reuters, 2014)
Global #1 Trusted Investment Bank and #2 for Expertise and Skills (The Economist, 2014)
Best Investment Bank in Canada across Equity, Debt and M&A for 7th consecutive year (Euromoney, 2014)
Best Project Finance House in North America (Euromoney, 2013)
Canadian fixed income sales & trading quality leader, Canadian fixed income market share leader (Greenwich Associates, 2014)
Leading Canadian Equities platform – ranked #1 in 2014 for Overall Trading Quality and #1 for Sales Quality (Greenwich Associates, 2014)
Top Equity research franchise in Canada – ranked #1 for five consecutive years (Brendan Wood International)
Best Bank for Fixed Income Research and Strategy (Technical Analyst Awards, 2014)
Investor Relations 18Capital Markets
Global Markets Revenue Corporate & Investment Banking Revenue
($ millions) ($ millions)
3,930 3,437
3,635
3,492
886 3,014
3,143 656
669
526 2,533
2,371 1,701
927 1,243 1,440
989
1,033 1,065 1,195
2,052 1,834 1,801 1,736
1,584 1,574
1,306 1,338
2011 2012 2013 2014 2011 2012 2013 2014
FICC Global Equities Repo and secured financing Investment Banking Lending and Other
Capital Markets Trading Securities Loans Outstanding by Region(1)
($ billions, average) ($ billions, average wholesale loan and acceptances)
61 61 63
58
53 8 10 10
49 7
47 48
104 106 105 7
101 101 103 6
100 99 6 6
30 31 30 31
26
22 23 24
21 22 21 22
19 19 19 20
Q1/2013 Q2/2013 Q3/2013 Q4/2013 Q1/2014 Q2/2014 Q3/2014 Q4/2014 Q1/2013 Q2/2013 Q3/2013 Q4/2013 Q1/2014 Q2/2014 Q3/2014 Q4/2014
Canada U.S. Other International
Investor Relations 19
(1) Average loans & acceptances, and letters of credit and guarantees for our Capital Markets portfolio, on single name basis. It excludes mortgage investments, securitized mortgages and
other non-core items).Canadian economy SECTION III
Canada’s strong fiscal position
Strong rating as a result of fiscal prudence, conservative bank lending practices and solid
economy
Lowest net debt to GDP ratio among G7 peers
#1 for soundness of banks for the 7th consecutive year(1)
A diversified economy supporting balanced economic growth
G7 Real GDP Growth (%)(3)
Canadian GDP by Industry(2) 2000-2013
(August 2014)
2.7
Finance, Insurance & Real Estate
2.2 2.3
Manufacturing 1.9
1.8
13%
20% Wholesale and Retail Trade 1.4
1.2
4%
Scientific, Technical & Educational Serv. 0.9
7% Public Administration and Utilities 0.3 2.8
Italy
Germany
U.K.
U.S.
Japan
France
Canada
Cda 2014F
Cda 2015F
11% Mining, Oil & Gas Extractions
7%
Construction
8% 11% Health Care
Transportation, Warehousing
9%
11%
Other
Investor Relations 21
(1) World Economic Forum, 2014. (3) National statistics offices, RBC Economics Research.
(2) Source: Statistics Canada, RBC Economics Research.Attractive economic fundamentals
Core inflation expected to remain stable Unemployment (%)(1)
around the mid-point of the Bank of Canada’s 13
Canada U.S.
1-3% target range 12
11
10
Unemployment rates are trending favourably 9
and are indicative of underlying conditions 8
7
remaining firm 6
5
Labour force participation trend 4
3
predominantly reflects an aging population 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014
rather than worker discouragement
Inflation (YoY %)(2) Labour Force Participation Rate (%)(1)
69
5
68
4
67
3
66
2
1 65
0 64
-1 63
-2 62
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014
Headline Core BoC Target Canada U.S.
Investor Relations 22
(1) Statistics Canada, Bureau of Labor Statistics, RBC Economics Research.
(2) Statistics Canada, RBC Economics Research.Note to users
We use a variety of financial measures to evaluate our performance. In addition to generally
accepted accounting principles (GAAP) prescribed measures, we use certain key performance and
non-GAAP measures we believe provide useful information to investors regarding our financial
condition and result of operations. Readers are cautioned that key performance measures, such as
ROE and non-GAAP measures such as earnings and revenue excluding Corporate Support,
earnings, earnings excluding charges related to new tax legislation in Canada, earnings excluding a
loss related to our acquisition of the remaining 50% stake of RBC Dexia and related to the
integration of Investor Services do not have any standardized meanings prescribed by GAAP, and
therefore are unlikely to be comparable to similar measures disclosed by other financial institutions.
Additional information about our ROE and non-GAAP measures can be found under the “Key
performance and non-GAAP measures” section of our 2014 Annual report.
Definitions can be found under the “Glossary” sections in our Q4/2014 Supplementary Financial
Information and our 2014 Annual Report.
Investor Relations Contacts
Amy Cairncross, VP & Head (416) 955-7803
Lynda Gauthier, Director (416) 955-7808
Christopher Taylor, Associate Director (416) 955-7872
www.rbc.com/investorrelations
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